"This paper characterizes the labor supply and borrowing of a household facing collateral requirements that limit its … debt and compel it to accumulate equity in its durable goods stock. The household's discount rate exceeds the market rate … constraints generate a positive comovement between the household's debt, the stock of durable goods and labor supply following …

Aggressive deregulation of the mortgage market in the early 1980s triggered innovations that greatly reduced the … 71 percent of GDP in 1982. A borrowing surge followed: Household debt increased from 43 to 62 percent of GDP in the 1982 …

other mortgage characteristics, including sub-prime, securitization and leverage. Where IOs were popular, their use does not …

. At the same time, they increase household leverage and heighten dependence on mortgage refinancing to escape changes in …